* Interior Secretary Salazar says Shell "screwed up" in 2012
* Interior report says Shell did not fully plan
* Shell will need third party audit of management systems
By Ayesha Rascoe
WASHINGTON, March 14 The U.S. Interior
Department said Royal Dutch Shell must submit an
in-depth plan before the company is allowed to drill in the
Arctic again, as the government slammed what it termed the
company's inadequate preparation for its troubled 2012 drilling
Shell has already said it is "pausing" plans to drill in the
Arctic again this year after facing numerous setbacks in 2012,
when the company undertook preliminary drilling activities.
"Shell screwed up in 2012 and we're not going to let them
screw up ... after their pause is removed," Interior Secretary
Ken Salazar said on a press call.
Salazar requested a 60-day day review of Shell's drilling
activities after the grounding of one of its rigs off the coast
of Alaska in late December.
The Coast Guard is currently investigating the rig accident.
While Shell was able to safely drill portions of two wells
in the Arctic, the Interior Department's report released on
Thursday said the company was not "fully prepared in terms of
fabricating and testing certain critical systems and
establishing the scope of its operational plans."
Shell has spent $4.5 billion so far in its effort to explore
for oil and gas in the Arctic, but has yet to fully complete a
The company was able to begin drilling in 2012, but was not
able to drill in areas containing oil because it was not able to
get its oil spill containment system certified by the government
Interior's report found that Shell's problems with its
containment system were the result of "shortcomings" in the
company's oversight of key contractors.
In addition to submitting a plan outlining all the aspects
of Shell's expected operations in the Arctic, the company must
also commission a third-party audit of all of its management
Shell said it remains committed to drilling off Alaska
"We will use this time to apply lessons learned from this
review, the ongoing Coast Guard investigation and our own
assessment of opportunities to further improve Shell's
exploration program offshore Alaska," the company said in a
Critics of Shell's drilling program said the report
confirmed their suspicions that the company was not ready to
begin exploration in the fragile and harsh Arctic environment.
"Until Shell demonstrates beyond a shadow of a doubt that
they have the capability to drill in the Arctic safely, their
drilling plans should remain on ice," said Congressman Edward
Markey of Massachusetts, the top Democrat on the House natural
Green groups, who have long argued that drilling in the
Arctic threatens the environment, said Interior's review did not
go far enough.
"After all the reports that were submitted to Interior, this
additional report does not give the public confidence that key
concerns with these extraordinarily complex drilling and marine
transport operations will be addressed," said Lois Epstein,
Anchorage-based Arctic program director for The Wilderness